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Which of the following is an indirect method of financing current assets with the support of a bank?

a. Purchase or discount bills b. Letter of Credit c. Cash Credit d. Overdraft e. Factoring.

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Question added by SHAIKH MOHAMMED BASHEER AHMED SHAIKH , Account Manager , Tarik Al Zahid Holding Company
Date Posted: 2014/05/06
Subhranshu Ganguly
by Subhranshu Ganguly , Quality Analyst. , WIPRO

Sir I think apart from letter of credit there could be another option.

I think it would be A>discounting of bills receivable with the bank. This is because bills of payment are only payable at a later date. If I want the money immediately I will get a discounted rate depositing the bills to finance my current assets. The amount that can be raised through LOC though variable is limited . But if the amount of bills receivable is large discounting them with the bank could be an option. Yes they can also be endorsed and discounted with3rd parties.

 

 

Meh Engelbert Kum
by Meh Engelbert Kum , Revenue Assurance Manager , Vodacom Business Africa, Cameroon

D

Deleted user
by Deleted user

The option "A" or the correct one !!!

Yusuf Dalal
by Yusuf Dalal , General Accountant. , Gmamco Contracting LLC

The Correct Answer is A

Muhammad Ikram
by Muhammad Ikram , Financial Contorller , Sparq Systems Inc.

A is the correct answer

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